IRAN: Parliament slashes cash subsidies to citizens

A story that brought much excitement to Basic Income News six years ago may be winding to its end.

In 2010, Iran became the first country to pay a de facto basic income to its citizens–a policy that emerged as a byproduct of a pressing demand to reform the nation’s system of fuel subsidies.

At that time, the Iranian government determined that it would dedicate half of its oil revenues to government services and businesses, while distributing the other half in the form of unconditional cash payments to all citizens. The monthly amount was equivalent to about 40 USD, paid to heads of households.

Within a year, however, the government began facing difficulty in financing the subsidy program, and eventually resorted to asking comparatively well-off citizens to voluntarily opt out. As a result of the requests, about two-and-half million citizens began declining their subsidies, while 73 million retained them.

But these voluntary withdrawals from the program proved insufficient to halt Iran’s growing budget deficit–and, in January 2016, the government announced that it would remove an additional 3.3 million Iranians from the subsidy program, as determined based on an assessment of their financial situation. (For example, as the New York Times reported, one middle-class merchant was unenrolled after purchasing a car worth $7000.)

Finally, in April, the Iranian parliament approved a bill that will result in the loss of the cash payments to about 24 million citizens — nearly one-third of the population. The cuts will go into effect in September of this year.

About Kate McFarland

Kate McFarland has written 501 articles.

I'm not the sort to define myself by a job or occupation. I do stuff that interests me and wait and see what happens job-wise (and, more generally, life-wise). If you want to see where my open-ended lifestyle leads next (I presently have no idea myself, and that's the excitement of it), follow my new personal blog. I don't attempt to sell or actively monetize my writing or other labors of love; however, I accept donations on Patreon and PayPal.

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